There is oil in Belize!
There is oil in Belize. Over the last 49 years, oil exploration companies have discovered high grade, crude oil in
the country. But the quantity of oil found (about 2-3 barrels of oil a day) is not of commercial amount (5,000
There have been 50 wells drilled by companies coming to Belize to conduct explorations in Western Belize. They come in; drill the earth but leave after months of work does not produce the necessary quantity of the natural resource.
Currently there is a 51st well being drilled by a company, Belize Natural Energy (BNE), made up of several experts in
geology, natural gas, drilling and finance and economics.
BNE has been in Belize since 2002. BNE has been casing areas in North, Central and South America looking for the best location for the next booming oil industry and they have chosen our backyard. According to one of the company directors, Sheila Mcaffery, they have spent the last three years identifying ready-to-drill prospects in Belize. They signed a Production Sharing Agreement (PSA) with the Government of Belize in late 2002 and were granted a license to explore 595,000 acres of land.
Mcaffery said the company has done extensive field study and has spent significant time collecting data. Study
methods such as topography, satellite imagery and geology have all been used by BNE to ensure that they “put
all the pieces of the jigsaw puzzle on the table”, she said.
A potential 3,000-acre structural closure has been discovered and mapped in the Yalbac and Hill Bank formations in the area of Spanish Lookout. Such structure could conservatively yield over 25-50 mm barrels of recoverable oil. This figure does not include closures at shallow depths that add to more than 1,000 acres with additional potential reserves of 12-25 mm barrels of recoverable oil.
Since 2003, the company has invested some $ 6 mm, primarily in conducting studies. Mcaffery indicated that the past
oil drills carried out by large multinational companies such as Chevron has been unsuccessful because they
didn’t gather sufficient information. The drillings were carried out in the wrong places, she said. In February
of this year, BNE conducted its last seismic study, where they measured the sand waves of the earth in order to
define possible structures that need to be developed.
“Our studies have shown that this is where we need to develop,” remarked Mcaffery. “We have a number of specialists working with us.”
BNE is currently drilling in an area in Spanish Lookout. The equipment arrived on May 29th and drilling started on
June 3rd. The work crew is made up of five United Kingdom nationals and the rest Belizeans. Five men: three Brits and
two Belizeans work the drill by shifts. BNE is drilling for 24 hours. The drilling rig averages 40 feet per
Mcaffery explained that drilling in Belize has been more expensive than in other regions because everything had to be imported. But she was happy to mention that they have not experienced any troubles while working in Belize.
“There have been no problems,” she said. “In fact, we’ve met a lot of good will from the people of Belize. Everyone is hoping and praying with us for success”.
One of Belize’s leading experts in petroleum, Andre Cho, who works as an Inspector of Petroleum in the Ministry
of Natural Resources was also optimistic about finding petroleum in the area of Spanish Lookout.
“We have a strong feeling that yes there is petroleum beneath us and we just have to drill and confirm that for sure,” said Cho.
According to Cho, BNE has invested in gathering extensive information. It is for that reason that for the first time
oil explorers in Belize may hit pay dirt. Should that happen, noted Cho, Belize will benefit greatly.
Our guess is that we will probably be producing and hopefully we are producing anywhere from 1,000 barrels to maybe 5,000 bpd for the field,” he said.
Should BNE be successful it would mean many new opportunities for Belize. Current price of crude oil is just under $
55 per barrel in an industry that continues to grow. This would mean that oil exports, if any, would yield some
significant foreign exchange. In addition, natural gas can be used for co-generation, which would assist in providing
Mcaffery announced that BNE knows a different way of doing business and will work for the development of Belize. One such way would be to allow Belizeans fair share in the company.
“We want to be a beacon for the rest of the world”.
For BNE it would also mean that they would be able to tap into the oil and gas market.
“It would be tremendous,” she said, “for as a small group we would achieve something the big, multinationals couldn’t”.
Mcaffery said it would be another three months of constant drilling before any substantial discovery of oil is made. However, should such as discovery be made it would mean BNE will have to increase its investment and come up with an international model on how to develop the oil and gas industry in Belize.
“Exploration success would require an estimated additional $ 10-15 mm in development expenditures to support an
initial production rate of 3,000-5,000 barrels of oil per day.”
“This in turn would generate $ 1-2 mm per month in cash flow that would then be adequate to support a drilling program that could grow through internal cash flow, we obviously have much to do to create this potential but this work is a start in the right direction,” she stated.